The electric vehicle (EV) battery “gigafactory” being constructed by a Volkswagen subsidiary in St. Thomas, Ont., is now set to commence operations in 2029, a two-year delay from the original schedule. PowerCo Canada, in a press release, disclosed the revised timeline and the appointment of Mississauga-based EllisDon Corporation as the general contractor for the factory’s construction.
The decision to push back the start date to 2029 is to align with advancements in next-generation battery technology and to allow for future scalability based on market dynamics, as per a company announcement. Despite the delay, PowerCo declined to provide a spokesperson for an interview regarding the matter.
Initially planned for a 2027 launch, the $7-billion factory, with federal government subsidies amounting to up to $13 billion, was unveiled in 2023. The project was forecasted to generate 3,000 direct jobs and numerous indirect employment opportunities in the region. To support the factory’s emergence, infrastructure enhancements were undertaken by surrounding municipalities and the provincial government to accommodate the anticipated population growth by 2027.
In preparation for the factory, St. Thomas secured additional land from Central Elgin, facilitated by a deal preceding the factory announcement. Construction activities for the project began in October 2025 after PowerCo Canada awarded significant construction contracts in August 2025.
Mayor Joe Preston of St. Thomas expressed confidence in the project despite the delay, emphasizing the ongoing recruitment efforts by PowerCo and the construction progress. Preston highlighted the development of Yarmouth Yards, an industrial park in St. Thomas attracting industries complementary to battery production, as a positive factor for the region’s economic growth.
The selection of EllisDon as the general contractor was met with approval by provincial officials, who viewed it as a significant step towards creating a substantial number of jobs directly and indirectly through the supply chain. The Ministry of Economic Development, Job Creation and Trade expressed eagerness to collaborate with PowerCo to establish the gigafactory, positioning Ontario as a leader in innovative battery and automotive production.
While the delay was met with disappointment by Andrew Lawton, the Conservative MP for Elgin—St. Thomas—London South, who questioned Volkswagen’s dedication to the plant, market adjustments in Ontario’s EV sector have influenced automakers’ production strategies. General Motors and Honda faced challenges related to EV demand, leading to production halts and cancellations of projects in the province. Despite these shifts, Canadian EV sales have shown promising growth trends, reflecting increasing interest in electric vehicles among consumers.
